Southwest Airlines Stock Forecast - Naive Prediction
| LUV Stock | USD 29.06 0.28 0.97% |
The Naive Prediction forecasted value of Southwest Airlines on the next trading day is expected to be 27.64 with a mean absolute deviation of 0.68 and the sum of the absolute errors of 41.48. Southwest Stock Forecast is based on your current time horizon. Investors can use this forecasting interface to forecast Southwest Airlines stock prices and determine the direction of Southwest Airlines's future trends based on various well-known forecasting models. We recommend always using this module together with an analysis of Southwest Airlines' historical fundamentals, such as revenue growth or operating cash flow patterns. Although Southwest Airlines' naive historical forecasting may sometimes provide an important future outlook for the firm, we recommend always cross-verifying it against solid analysis of Southwest Airlines' systematic risk associated with finding meaningful patterns of Southwest Airlines fundamentals over time.
Check out Historical Fundamental Analysis of Southwest Airlines to cross-verify your projections. Southwest |
Open Interest Against 2024-04-19 Southwest Option Contracts
Although open interest is a measure utilized in the options markets, it could be used to forecast Southwest Airlines' spot prices because the number of available contracts in the market changes daily, and new contracts can be created or liquidated at will. Since open interest in Southwest Airlines' options reflects these daily shifts, investors could use the patterns of these changes to develop long and short-term trading strategies for Southwest Airlines stock based on available contracts left at the end of a trading day.
Please note that to derive more accurate forecasting about market movement from the current Southwest Airlines' open interest, investors have to compare it to Southwest Airlines' spot prices. As Ford's stock price increases, high open interest indicates that money is entering the market, and the market is strongly bullish. Conversely, if the price of Southwest Airlines is decreasing and there is high open interest, that is a sign that the bearish trend will continue, and investors may react by taking short positions in Southwest. So, decreasing or low open interest during a bull market indicates that investors are becoming uncertain of the depth of the bullish trend, and a reversal in sentiment will likely follow.
Most investors in Southwest Airlines cannot accurately predict what will happen the next trading day because, historically, stock markets tend to be unpredictable and even illogical. Modeling turbulent structures requires applying different statistical methods, techniques, and algorithms to find hidden data structures or patterns within the Southwest Airlines' time series price data and predict how it will affect future prices. One of these methodologies is forecasting, which interprets Southwest Airlines' price structures and extracts relationships that further increase the generated results' accuracy.
A naive forecasting model for Southwest Airlines is a special case of the moving average forecasting where the number of periods used for smoothing is one. Therefore, the forecast of Southwest Airlines value for a given trading day is simply the observed value for the previous period. Due to the simplistic nature of the naive forecasting model, it can only be used to forecast up to one period. Southwest Airlines Naive Prediction Price Forecast For the 20th of April
Given 90 days horizon, the Naive Prediction forecasted value of Southwest Airlines on the next trading day is expected to be 27.64 with a mean absolute deviation of 0.68, mean absolute percentage error of 0.97, and the sum of the absolute errors of 41.48.Please note that although there have been many attempts to predict Southwest Stock prices using its time series forecasting, we generally do not recommend using it to place bets in the real market. The most commonly used models for forecasting predictions are the autoregressive models, which specify that Southwest Airlines' next future price depends linearly on its previous prices and some stochastic term (i.e., imperfectly predictable multiplier).
Southwest Airlines Stock Forecast Pattern
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Southwest Airlines Forecasted Value
In the context of forecasting Southwest Airlines' Stock value on the next trading day, we examine the predictive performance of the model to find good statistically significant boundaries of downside and upside scenarios. Southwest Airlines' downside and upside margins for the forecasting period are 25.10 and 30.19, respectively. We have considered Southwest Airlines' daily market price to evaluate the above model's predictive performance. Remember, however, there is no scientific proof or empirical evidence that traditional linear or nonlinear forecasting models outperform artificial intelligence and frequency domain models to provide accurate forecasts consistently.
Model Predictive Factors
The below table displays some essential indicators generated by the model showing the Naive Prediction forecasting method's relative quality and the estimations of the prediction error of Southwest Airlines stock data series using in forecasting. Note that when a statistical model is used to represent Southwest Airlines stock, the representation will rarely be exact; so some information will be lost using the model to explain the process. AIC estimates the relative amount of information lost by a given model: the less information a model loses, the higher its quality.| AIC | Akaike Information Criteria | 118.0783 |
| Bias | Arithmetic mean of the errors | None |
| MAD | Mean absolute deviation | 0.6801 |
| MAPE | Mean absolute percentage error | 0.0224 |
| SAE | Sum of the absolute errors | 41.4845 |
Predictive Modules for Southwest Airlines
There are currently many different techniques concerning forecasting the market as a whole, as well as predicting future values of individual securities such as Southwest Airlines. Regardless of method or technology, however, to accurately forecast the stock market is more a matter of luck rather than a particular technique. Nevertheless, trying to predict the stock market accurately is still an essential part of the overall investment decision process. Using different forecasting techniques and comparing the results might improve your chances of accuracy even though unexpected events may often change the market sentiment and impact your forecasting results.Sophisticated investors, who have witnessed many market ups and downs, anticipate that the market will even out over time. This tendency of Southwest Airlines' price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy.
Other Forecasting Options for Southwest Airlines
For every potential investor in Southwest, whether a beginner or expert, Southwest Airlines' price movement is the inherent factor that sparks whether it is viable to invest in it or hold it better. Southwest Stock price charts are filled with many 'noises.' These noises can hugely alter the decision one can make regarding investing in Southwest. Basic forecasting techniques help filter out the noise by identifying Southwest Airlines' price trends.Southwest Airlines Related Equities
One of the popular trading techniques among algorithmic traders is to use market-neutral strategies where every trade hedges away some risk. Because there are two separate transactions required, even if one position performs unexpectedly, the other equity can make up some of the losses. Below are some of the equities that can be combined with Southwest Airlines stock to make a market-neutral strategy. Peer analysis of Southwest Airlines could also be used in its relative valuation, which is a method of valuing Southwest Airlines by comparing valuation metrics with similar companies.
| Risk & Return | Correlation |
Southwest Airlines Technical and Predictive Analytics
The stock market is financially volatile. Despite the volatility, there exist limitless possibilities of gaining profits and building passive income portfolios. With the complexity of Southwest Airlines' price movements, a comprehensive understanding of forecasting methods that an investor can rely on to make the right move is invaluable. These methods predict trends that assist an investor in predicting the movement of Southwest Airlines' current price.| Cycle Indicators | ||
| Math Operators | ||
| Math Transform | ||
| Momentum Indicators | ||
| Overlap Studies | ||
| Pattern Recognition | ||
| Price Transform | ||
| Statistic Functions | ||
| Volatility Indicators | ||
| Volume Indicators |
Southwest Airlines Market Strength Events
Market strength indicators help investors to evaluate how Southwest Airlines stock reacts to ongoing and evolving market conditions. The investors can use it to make informed decisions about market timing, and determine when trading Southwest Airlines shares will generate the highest return on investment. By undertsting and applying Southwest Airlines stock market strength indicators, traders can identify Southwest Airlines entry and exit signals to maximize returns.
| Accumulation Distribution | 0.021 | |||
| Daily Balance Of Power | 0.4516 | |||
| Rate Of Daily Change | 1.01 | |||
| Day Median Price | 29.2 | |||
| Day Typical Price | 29.15 | |||
| Market Facilitation Index | 0.62 | |||
| Period Momentum Indicator | 0.28 |
Southwest Airlines Risk Indicators
The analysis of Southwest Airlines' basic risk indicators is one of the essential steps in accurately forecasting its future price. The process involves identifying the amount of risk involved in Southwest Airlines' investment and either accepting that risk or mitigating it. Along with some essential techniques for forecasting southwest stock prices, we also provide a set of basic risk indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Mean Deviation | 1.58 | |||
| Semi Deviation | 2.95 | |||
| Standard Deviation | 2.64 | |||
| Variance | 6.98 | |||
| Downside Variance | 9.32 | |||
| Semi Variance | 8.69 | |||
| Expected Short fall | (1.69) |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential investments, we recommend comparing similar equities with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
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Try AI Portfolio ArchitectCheck out Historical Fundamental Analysis of Southwest Airlines to cross-verify your projections. For more information on how to buy Southwest Stock please use our How to Invest in Southwest Airlines guide.You can also try the My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Complementary Tools for Southwest Stock analysis
When running Southwest Airlines' price analysis, check to measure Southwest Airlines' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Southwest Airlines is operating at the current time. Most of Southwest Airlines' value examination focuses on studying past and present price action to predict the probability of Southwest Airlines' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Southwest Airlines' price. Additionally, you may evaluate how the addition of Southwest Airlines to your portfolios can decrease your overall portfolio volatility.
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Is Southwest Airlines' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Southwest Airlines. If investors know Southwest will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Southwest Airlines listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth (0.30) | Dividend Share 0.72 | Earnings Share 0.76 | Revenue Per Share 43.85 | Quarterly Revenue Growth 0.105 |
The market value of Southwest Airlines is measured differently than its book value, which is the value of Southwest that is recorded on the company's balance sheet. Investors also form their own opinion of Southwest Airlines' value that differs from its market value or its book value, called intrinsic value, which is Southwest Airlines' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Southwest Airlines' market value can be influenced by many factors that don't directly affect Southwest Airlines' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Southwest Airlines' value and its price as these two are different measures arrived at by different means. Investors typically determine if Southwest Airlines is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Southwest Airlines' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.